As 2017 draws to a close, organizations reluctant to upgrade legacy systems should consider the costs of inaction
The status quo—it’s what you’ve always done. It’s just the way your company does things. Why risk rocking the boat? Well, when it comes to digital transformation, delaying the optimization of resources can have real costs. If your organization is on the fence about a digital upgrade for 2018, you’ll want to take into consideration that waiting to make a decision is a risk in and of itself.
If inaction leads to month-to-month increases in costs, then it may be easy to see why a change is needed, and soon. But additional consequences of sitting on the sidelines can pile up as well. Decades-old IT systems and manual processes bog companies down, lower employee morale, and cause friction for customers that may abandon your business for a more digitally advanced competitor. Lack of a digital optimization strategy can limit the ability to create revenue-generating opportunities when they are needed most.
Many advanced technologies—big data analytics, the Internet of Things (IoT), cloud computing, machine learning and artificial intelligence, voice-enabled tech, and more—are reaching maturity and mass affordability. As these technologies become more accessible, economies of scale drive costs even further down. Organizations considering incorporating these new technologies into their operations should shift from asking “What should we be doing with tech?” to “How can tech unlock value in our industry?”
As businesses plan their digital strategies for 2018, IT leaders and executives can take the following steps into consideration as they chart their next move:
Scan the Environment
Rather than narrowing in on a specific problem or department, take a spectrum view to consider the full variety of options and permutations that are possible. It’s from here that you find what fits for your business.
- Look at competitors and adjacent markets.
- Get out of the echo chamber of your office, organization, or unit and get into the field to see what’s really going on.
- Assess the digital maturity of the business today.
Define the Landscape
It’s not necessary to map out the details of every process of the business. Start with a simple top-down perspective and consider where friction lies and can be reduced.
- Be intuitive—run with what feels right, time is ticking.
- The closer employee activities are to the delivery of revenue or the acquisition of revenue, the better the opportunity for obtaining value in implementing a digital transformation.
- Within the landscape, identify the key areas of opportunity.
- Do small-scale journey and process mapping. A large-scale survey isn’t necessary, but getting direct input from the workforce to identify key touch points and pain points can have huge returns in assessing priorities as well as viability. It might also allow you to find some surprise opportunities while gaining a collaborative development of the solution.
Use the results of the scan activity, including the trusted advisers and partners identified during the scanning efforts, to evaluate the myths versus the realities of opportunities. Ask whether the opportunity is based on known implementations and appropriately available tech.
- The myth versus reality evaluation should include input and/or participation from the key constituents—IT, operations, HR, etc.—to ensure that the opportunity is viable. Look for speed bumps and reality checks. If implementing new tech might require retraining under a union contract or might disrupt a long-term contract with a supplier, then you can better assess the realities.
- The costs of investing in and implementing each opportunity should be modeled. In some cases, the ROI is obvious, such as technology that opens new revenue streams. In others, the benefits are more intangible, such as increased opportunities for worker collaboration.
- Beyond the investment costs and benefits, a consideration of the opportunity costs is also essential—the potentially missed chance for workers to do something else that would save the organization time and money. Consider all usage outcomes as potential sources of value. How will the technology increase efficiency by improving ease of use? How will fewer errors and consistent task execution lead to more profits? Is the solution expected to reduce attrition?
Take the Leap!
With your opportunity roadmap in place, you’re now ready to take action. Be sure to set achievable business goals and set measurable metrics to continuously track your company’s progress. Increment swiftly. Learn, record, adjust measures or KPIs, and then iterate. Once an MVP can be defined, move out of experimentation toward implementation.
Not sure where to begin? Mission Data is passionate about helping clients navigate the future of work by finding practical solutions that create real business value. Whether your organization is developing a proof of concept or considering a major system-wide implementation, Mission Data can guide you toward greater efficiencies for years to come.